IC 23-19-2Chapter 2. Exemptions From Registration of Securities

IC 23-19-2-1Exempt securities

Sec. 1. The following securities are exempt from the requirementsof IC 23-19-3-1 through IC 23-19-3-6 and IC 23-19-5-4:

(1) A security, including a revenue obligation or a separatesecurity as defined in Rule 131 (17 CFR 230.131) adoptedunder the Securities Act of 1933, issued, insured, or guaranteedby the United States; by a state; by a political subdivision of astate; by a public authority, agency, or instrumentality of one (1)or more states; by a political subdivision of one (1) or morestates; or by a person controlled or supervised by and acting asan instrumentality of the United States under authority grantedby Congress; or a certificate of deposit for any of the foregoing.(2) A security issued, insured, or guaranteed by a foreigngovernment with which the United States maintains diplomaticrelations, or any of its political subdivisions, if the security isrecognized as a valid obligation by the issuer, insurer, orguarantor.(3) A security issued by and representing or that will representan interest in or a direct obligation of, or be guaranteed by:

(A) an international banking institution;(B) a banking institution organized under the laws of theUnited States; a member bank of the Federal ReserveSystem; or a depository institution a substantial part of thebusiness of which consists or will consist of receivingdeposits or share accounts that are insured to the maximumamount authorized by statute by the Federal DepositInsurance Corporation, the National Credit Union ShareInsurance Fund, or a successor authorized by federal law orexercising fiduciary powers that are similar to thosepermitted for national banks under the authority of theComptroller of Currency under Section 1 of Public Law87-722 (12 U.S.C. 92a); or(C) any other depository institution, unless by rule or orderthe commissioner proceeds under section 4 of this chapter.

(4) A security issued by and representing an interest in or a debtof, or insured or guaranteed by, an insurance companyauthorized to do business in Indiana.(5) A security issued or guaranteed by a railroad, other commoncarrier, public utility, or public utility holding company that is:

(A) regulated in respect to its rates and charges by the UnitedStates or a state;(B) regulated in respect to the issuance or guarantee of thesecurity by the United States, a state, Canada, or a Canadianprovince or territory; or(C) a public utility holding company registered under thePublic Utility Holding Company Act of 1935 or a subsidiary

of such a registered holding company within the meaning ofthat act.

(6) A federal covered security specified in Section 18(b)(1) ofthe Securities Act of 1933 (15 U.S.C. 77r(b)(1)) or by ruleadopted under that provision or a security listed or approved forlisting on another securities market specified by rule under thisarticle; a put or a call option contract; a warrant; a subscriptionright on or with respect to such securities; an option or similarderivative security on a security or an index of securities orforeign currencies issued by a clearing agency registered underthe Securities Exchange Act of 1934 and listed or designated fortrading on a national securities exchange, a facility of a nationalsecurities exchange, or a facility of a national securitiesassociation registered under the Securities Exchange Act of1934 or an offer or sale, of the underlying security in connectionwith the offer, sale, or exercise of an option or other securitythat was exempt when the option or other security was writtenor issued; or an option or a derivative security designated by theSecurities and Exchange Commission under Section 9(b) of theSecurities Exchange Act of 1934 (15 U.S.C. 78i(b)).(7) A member's or owner's interest in, or a retention certificateor like security given in lieu of a cash patronage dividend issuedby, a cooperative organized and operated as a nonprofitmembership cooperative under the cooperative laws of a state,but not a member's or owner's interest, retention certificate, orlike security sold to persons other than bona fide members ofthe cooperative.(8) An equipment trust certificate with respect to equipmentleased or conditionally sold to a person, if any security issuedby the person would be exempt under this section or would bea federal covered security under Section 18(b)(1) of theSecurities Act of 1933 (15 U.S.C. 77r(b)(1)).(9) A security issued by a nonprofit corporation as defined bySection 501(c)(3) of the Internal Revenue Code that isdesignated by the governor as the secondary market forguaranteed student loans under IC 20-12-21.2.

As added by P.L.27-2007, SEC.23.

IC 23-19-2-2 Version aExempt transactions

Note: This version of section amended by P.L.71-2014, SEC.1. Seealso following version of this section amended by P.L.106-2014,SEC.3.

Sec. 2. The following transactions are exempt from therequirements of IC 23-19-3-1 through IC 23-19-3-6 andIC 23-19-5-4:

(1) An isolated nonissuer transaction, whether effected by orthrough a broker-dealer or not.(2) A nonissuer transaction by or through a broker-dealerregistered, or exempt from registration under this article, and a

resale transaction by a sponsor of a unit investment trustregistered under the Investment Company Act of 1940, in asecurity of a class that has been outstanding in the hands of thepublic for at least ninety (90) days, if, at the date of thetransaction:

(A) the issuer of the security is engaged in business, theissuer is not in the organizational stage or in bankruptcy orreceivership, and the issuer is not a blank check, blind pool,or shell company that has no specific business plan orpurpose or has indicated that its primary business plan is toengage in a merger or combination of the business with, oran acquisition of, an unidentified person;(B) the security is sold at a price reasonably related to itscurrent market price;(C) the security does not constitute the whole or part of anunsold allotment to, or a subscription or participation by, thebroker-dealer as an underwriter of the security or aredistribution;(D) a nationally recognized securities manual or itselectronic equivalent designated by rule adopted or orderissued under this article or a record filed with the Securitiesand Exchange Commission that is publicly availablecontains:

(i) a description of the business and operations of theissuer;(ii) the names of the issuer's executive officers and thenames of the issuer's directors, if any;(iii) an audited balance sheet of the issuer as of a datewithin eighteen (18) months before the date of thetransaction or, in the case of a reorganization or mergerwhen the parties to the reorganization or merger each hadan audited balance sheet, a pro forma balance sheet for thecombined organization; and(iv) an audited income statement for each of the issuer'stwo (2) immediately previous fiscal years or for the periodof existence of the issuer, whichever is shorter, or, in thecase of a reorganization or merger when each party to thereorganization or merger had audited income statements,a pro forma income statement; and

(E) any one (1) of the following requirements is met:(i) The issuer of the security has a class of equity securitieslisted on a national securities exchange registered underSection 6 of the Securities Exchange Act of 1934 ordesignated for trading on the National Association ofSecurities Dealers Automated Quotation System.(ii) The issuer of the security is a unit investment trustregistered under the Investment Company Act of 1940.(iii) The issuer of the security, including its predecessors,has been engaged in continuous business for at least three(3) years.

(iv) The issuer of the security has total assets of at leasttwo million dollars ($2,000,000) based on an auditedbalance sheet as of a date within eighteen (18) monthsbefore the date of the transaction or, in the case of areorganization or merger when the parties to thereorganization or merger each had such an audited balancesheet, a pro forma balance sheet for the combinedorganization.

(3) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this article in asecurity of a foreign issuer that is a margin security defined inregulations or rules adopted by the Board of Governors of theFederal Reserve System.(4) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this article in anoutstanding security if the guarantor of the security files reportswith the Securities and Exchange Commission under thereporting requirements of Section 13 or 15(d) of the SecuritiesExchange Act of 1934 (15 U.S.C. 78m or 78o(d)).(5) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this article in asecurity that:

(A) is rated at the time of the transaction by a nationallyrecognized statistical rating organization in one (1) of its four(4) highest rating categories; or(B) has a fixed maturity or a fixed interest or dividend, if:

(i) a default has not occurred during the current fiscal yearor within the three (3) previous fiscal years, or during theexistence of the issuer and any predecessor if less thanthree (3) fiscal years, in the payment of principal, interest,or dividends on the security; and(ii) the issuer is engaged in business, is not in theorganizational stage or in bankruptcy or receivership, andis not and has not been within the previous twelve (12)months a blank check, blind pool, or shell company thathas no specific business plan or purpose or has indicatedthat its primary business plan is to engage in a merger orcombination of the business with, or an acquisition of, anunidentified person.

(6) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this articleeffecting an unsolicited order or offer to purchase.(7) A nonissuer transaction executed by a bona fide pledgeewithout the purpose of evading this article.(8) A nonissuer transaction by a federal covered investmentadviser with investments under management in excess of onehundred million dollars ($100,000,000) acting in the exercise ofdiscretionary authority in a signed record for the account ofothers.(9) A transaction in a security, whether or not the security or

transaction is otherwise exempt, in exchange for one (1) or morebona fide outstanding securities, claims, or property interests, orpartly in such exchange and partly for cash, if the terms andconditions of the issuance and exchange or the delivery andexchange and the fairness of the terms and conditions have beenapproved by the commissioner after a hearing.(10) A transaction between the issuer or other person on whosebehalf the offering is made and an underwriter, or amongunderwriters.(11) A transaction in a note, bond, debenture, or other evidenceof indebtedness secured by a mortgage or other securityagreement if:

(A) the note, bond, debenture, or other evidence ofindebtedness is offered and sold with the mortgage or othersecurity agreement as a unit;(B) a general solicitation or general advertisement of thetransaction is not made; and(C) a commission or other remuneration is not paid or given,directly or indirectly, to a person not registered under thisarticle as a broker-dealer or as an agent.

(12) A transaction by an executor, administrator of an estate,sheriff, marshal, receiver, trustee in bankruptcy, guardian, orconservator.(13) A sale or offer to sell to:

(A) an institutional investor;(B) a federal covered investment adviser; or(C) any other person exempted by rule adopted or orderissued under this article.

(14) A sale or an offer to sell securities of an issuer, if thetransaction is part of a single issue in which:

(A) not more than twenty-five (25) purchasers are present inthis state during any twelve (12) consecutive months, otherthan those designated in subdivision (13);(B) a general solicitation or general advertising is not madein connection with the offer to sell or sale of the securities;(C) a commission or other remuneration is not paid or given,directly or indirectly, to a person other than a broker-dealerregistered under this article or an agent registered under thisarticle for soliciting a prospective purchaser in this state; and(D) the issuer reasonably believes that all the purchasers inthis state, other than those designated in subdivision (13), arepurchasing for investment.

(15) A transaction under an offer to existing security holders ofthe issuer, including persons that at the date of the transactionare holders of convertible securities, options, or warrants, if acommission or other remuneration, other than a standbycommission, is not paid or given, directly or indirectly, forsoliciting a security holder in this state.(16) An offer to sell, but not a sale, of a security not exemptfrom registration under the Securities Act of 1933 if:

(A) a registration or offering statement or similar record asrequired under the Securities Act of 1933 has been filed, butis not effective, or the offer is made in compliance with Rule165 adopted under the Securities Act of 1933 (17 CFR230.165); and(B) a stop order of which the offeror is aware has not beenissued against the offeror by the commissioner or theSecurities and Exchange Commission, and an audit,inspection, or proceeding that is public and that mayculminate in a stop order is not known by the offeror to bepending.

(17) An offer to sell, but not a sale of, a security exempt fromregistration under the Securities Act of 1933 if:

(A) a registration statement has been filed under this article,but is not effective;(B) a solicitation of interest is provided in a record toofferees in compliance with a rule adopted by thecommissioner under this article; and(C) a stop order of which the offeror is aware has not beenissued by the commissioner under this article and an audit,inspection, or proceeding that may culminate in a stop orderis not known by the offeror to be pending.

(18) A transaction involving the distribution of the securities ofan issuer to the security holders of another person in connectionwith a merger, consolidation, exchange of securities, sale ofassets, or other reorganization to which the issuer, or its parentor subsidiary and the other person, or its parent or subsidiary,are parties.(19) A rescission offer, sale, or purchase under IC 23-19-5-10.(20) An offer or sale of a security to a person not a resident ofthis state and not present in this state if the offer or sale does notconstitute a violation of the laws of the state or foreignjurisdiction in which the offeree or purchaser is present and isnot part of an unlawful plan or scheme to evade this article.(21) Employees' stock purchase, savings, option, profit-sharing,pension, or similar employees' benefit plan, including anysecurities, plan interests, and guarantees issued under acompensatory benefit plan or compensation contract, containedin a record, established by the issuer, its parents, itsmajority-owned subsidiaries, or the majority-owned subsidiariesof the issuer's parent for the participation of their employeesincluding offers or sales of such securities to:

(A) directors; general partners; trustees, if the issuer is abusiness trust; officers; consultants; and advisers;(B) family members who acquire such securities from thosepersons through gifts or domestic relations orders;(C) former employees, directors, general partners, trustees,officers, consultants, and advisers if those individuals wereemployed by or providing services to the issuer when thesecurities were offered; and

(D) insurance agents who are exclusive insurance agents ofthe issuer, or the issuer's subsidiaries or parents, or whoderive more than fifty percent (50%) of their annual incomefrom those organizations.

(22) A transaction involving:(A) a stock dividend or equivalent equity distribution,whether the corporation or other business organizationdistributing the dividend or equivalent equity distribution isthe issuer or not, if nothing of value is given by stockholdersor other equity holders for the dividend or equivalent equitydistribution other than the surrender of a right to a cash orproperty dividend if each stockholder or other equity holdermay elect to take the dividend or equivalent equitydistribution in cash, property, or stock;(B) an act incident to a judicially approved reorganization inwhich a security is issued in exchange for one (1) or moreoutstanding securities, claims, or property interests, or partlyin such exchange and partly for cash; or(C) the solicitation of tenders of securities by an offeror in atender offer in compliance with Rule 162 adopted under theSecurities Act of 1933 (17 CFR 230.162).

(23) A nonissuer transaction in an outstanding security by orthrough a broker-dealer registered or exempt from registrationunder this article, if the issuer is a reporting issuer in a foreignjurisdiction designated by this subdivision or by rule adopted ororder issued under this article; has been subject to continuousreporting requirements in the foreign jurisdiction for not lessthan one hundred eighty (180) days before the transaction; andthe security is listed on the foreign jurisdiction's securitiesexchange that has been designated by this subdivision or by ruleadopted or order issued under this article, or is a security of thesame issuer that is of senior or substantially equal rank to thelisted security or is a warrant or right to purchase or subscribeto any of the foregoing. For purposes of this subdivision,Canada, together with its provinces and territories, is adesignated foreign jurisdiction and The Toronto StockExchange, Inc., is a designated securities exchange. After anadministrative hearing in compliance with this article, thecommissioner, by rule adopted or order issued under this article,may revoke the designation of a securities exchange under thissubdivision, if the commissioner finds that revocation isnecessary or appropriate in the public interest and for theprotection of investors.(24) An offer to sell or a sale of a security of an issuer under anoffering made and completed solely within Indiana, if:

(A) the transaction is part of a single issue in which:(i) not more than twenty-five (25) purchasers are presentin Indiana during any twelve (12) consecutive months,other than those designated in subdivision (13);(ii) general solicitation or general advertising is not made

in connection with the offer to sell or the sale of thesecurity;(iii) a commission or other remuneration is not paid orgiven, directly or indirectly, to a person other than abroker-dealer registered under this article, or to an agentregistered under this article, for soliciting a prospectivepurchaser in Indiana; and(iv) the issuer reasonably believes that all the purchasers inIndiana, other than those designated in subdivision (13),are purchasing for investment; and

(B) the issuer:(i) is not a registered securities broker-dealer; and(ii) does not sell issue by or through a registered securitiesbroker-dealer; and

(C) the issuer files a notice of the issuer's intent to sell asecurity in accordance with this subdivision on a formprescribed by the commissioner.

The commissioner may require the issuer to furnish anyadditional information considered necessary by thecommissioner to determine the issuer's qualifications.(25) An offer to sell or a sale of a security of an issuer, if thefollowing apply:

(A) The transaction is part of a single issue in which:(i) the offer or sale is made in compliance with 17 CFR230.504, 17 CFR 230.505, and 17 CFR 230.506, includingany offer or sale made exempt by the application of 17CFR 508(a);(ii) the issuer is required to submit a notice filing on aForm D not later than fifteen (15) days after the first saleof securities in this state; and(iii) by submitting the notice described in item (ii), theissuer agrees, upon written request by the commissioner,to furnish to the commissioner any information the issuerfurnished to offerees.

(B) For offerings made in compliance with 17 CFR 230.504,no commission, fee, or other remuneration is paid or given,directly or indirectly, to any broker-dealer for soliciting anyprospective purchaser in this state unless the broker-dealer isappropriately registered under this article. It is a defense toa violation of this clause if the issuer sustains the burden ofproof that the issuer did not know and, in the exercise ofreasonable care could not have known, that the person whoreceived the commission, fee, or other remuneration was notproperly registered.(C) In all sales to purchasers other than those described insubdivision (13) for offerings made in compliance with 17CFR 230.504, at least one (1) of the following is satisfied:

(i) The investment is suitable for the purchaser upon thebasis of facts, if any facts are disclosed by the purchaser,as to the purchaser's other securities holdings, financial

situation, and needs. For purposes of this item only, it ispresumed that, if the investment does not exceed tenpercent (10%) of the investor's net worth, the investmentis suitable.(ii) The purchaser, either alone or with the purchaser'srepresentative or representatives, has the knowledge andexperience in financial and business matters thatdemonstrate that the purchaser is capable of evaluating themerits and risks of the prospective investment.

(26) Subject to section 2.4 of this chapter, an offer to sell or asale of a security by an issuer in a transaction that meets all thefollowing requirements:

(A) The sale of the security is made only to a person who:(i) is; or(ii) the issuer reasonably believes is;

an accredited investor as defined in 17 CFR 230.501(a).(B) The issuer complies with the requirements in section 2.6of this chapter.(C) The issuer:

(i) reasonably believes that all purchasers are purchasingfor investment; and(ii) is not selling or offering to sell the security with theview to or for sale in connection with a distribution of thesecurity.

If a security is resold within twelve (12) months after the datethat the security was sold in reliance on the exemption underthis subdivision, the sale of the security in reliance on thisexemption is presumed to be with a view to distribution and notfor investment. However, the presumption does not apply to asecurity resold under a registration statement effective underIC 23-19-3-4 or IC 23-19-3-5 or to an accredited investor underan exemption available under this section.

As added by P.L.27-2007, SEC.23. Amended by P.L.71-2014, SEC.1.

IC 23-19-2-2 Version bExempt transactions

Note: This version of section amended by P.L.106-2014, SEC.3.See also preceding version of this section amended by P.L.71-2014,SEC.1.

Sec. 2. The following transactions are exempt from therequirements of IC 23-19-3-1 through IC 23-19-3-6 andIC 23-19-5-4:

(1) An isolated nonissuer transaction, whether effected by orthrough a broker-dealer or not.(2) A nonissuer transaction by or through a broker-dealerregistered, or exempt from registration under this article, and aresale transaction by a sponsor of a unit investment trustregistered under the Investment Company Act of 1940, in asecurity of a class that has been outstanding in the hands of thepublic for at least ninety (90) days, if, at the date of the

transaction:(A) the issuer of the security is engaged in business, theissuer is not in the organizational stage or in bankruptcy orreceivership, and the issuer is not a blank check, blind pool,or shell company that has no specific business plan orpurpose or has indicated that its primary business plan is toengage in a merger or combination of the business with, oran acquisition of, an unidentified person;(B) the security is sold at a price reasonably related to itscurrent market price;(C) the security does not constitute the whole or part of anunsold allotment to, or a subscription or participation by, thebroker-dealer as an underwriter of the security or aredistribution;(D) a nationally recognized securities manual or itselectronic equivalent designated by rule adopted or orderissued under this article or a record filed with the Securitiesand Exchange Commission that is publicly availablecontains:

(i) a description of the business and operations of theissuer;(ii) the names of the issuer's executive officers and thenames of the issuer's directors, if any;(iii) an audited balance sheet of the issuer as of a datewithin eighteen (18) months before the date of thetransaction or, in the case of a reorganization or mergerwhen the parties to the reorganization or merger each hadan audited balance sheet, a pro forma balance sheet for thecombined organization; and(iv) an audited income statement for each of the issuer'stwo (2) immediately previous fiscal years or for the periodof existence of the issuer, whichever is shorter, or, in thecase of a reorganization or merger when each party to thereorganization or merger had audited income statements,a pro forma income statement; and

(E) any one (1) of the following requirements is met:(i) The issuer of the security has a class of equity securitieslisted on a national securities exchange registered underSection 6 of the Securities Exchange Act of 1934 ordesignated for trading on the National Association ofSecurities Dealers Automated Quotation System.(ii) The issuer of the security is a unit investment trustregistered under the Investment Company Act of 1940.(iii) The issuer of the security, including its predecessors,has been engaged in continuous business for at least three(3) years.(iv) The issuer of the security has total assets of at leasttwo million dollars ($2,000,000) based on an auditedbalance sheet as of a date within eighteen (18) monthsbefore the date of the transaction or, in the case of a

reorganization or merger when the parties to thereorganization or merger each had such an audited balancesheet, a pro forma balance sheet for the combinedorganization.

(3) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this article in asecurity of a foreign issuer that is a margin security defined inregulations or rules adopted by the Board of Governors of theFederal Reserve System.(4) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this article in anoutstanding security if the guarantor of the security files reportswith the Securities and Exchange Commission under thereporting requirements of Section 13 or 15(d) of the SecuritiesExchange Act of 1934 (15 U.S.C. 78m or 78o(d)).(5) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this article in asecurity that:

(A) is rated at the time of the transaction by a nationallyrecognized statistical rating organization in one (1) of its four(4) highest rating categories; or(B) has a fixed maturity or a fixed interest or dividend, if:

(i) a default has not occurred during the current fiscal yearor within the three (3) previous fiscal years, or during theexistence of the issuer and any predecessor if less thanthree (3) fiscal years, in the payment of principal, interest,or dividends on the security; and(ii) the issuer is engaged in business, is not in theorganizational stage or in bankruptcy or receivership, andis not and has not been within the previous twelve (12)months a blank check, blind pool, or shell company thathas no specific business plan or purpose or has indicatedthat its primary business plan is to engage in a merger orcombination of the business with, or an acquisition of, anunidentified person.

(6) A nonissuer transaction by or through a broker-dealerregistered or exempt from registration under this articleeffecting an unsolicited order or offer to purchase.(7) A nonissuer transaction executed by a bona fide pledgeewithout the purpose of evading this article.(8) A nonissuer transaction by a federal covered investmentadviser with investments under management in excess of onehundred million dollars ($100,000,000) acting in the exercise ofdiscretionary authority in a signed record for the account ofothers.(9) A transaction in a security, whether or not the security ortransaction is otherwise exempt, in exchange for one (1) or morebona fide outstanding securities, claims, or property interests, orpartly in such exchange and partly for cash, if the terms andconditions of the issuance and exchange or the delivery and

exchange and the fairness of the terms and conditions have beenapproved by the commissioner after a hearing.(10) A transaction between the issuer or other person on whosebehalf the offering is made and an underwriter, or amongunderwriters.(11) A transaction in a note, bond, debenture, or other evidenceof indebtedness secured by a mortgage or other securityagreement if:

(A) the note, bond, debenture, or other evidence ofindebtedness is offered and sold with the mortgage or othersecurity agreement as a unit;(B) a general solicitation or general advertisement of thetransaction is not made; and(C) a commission or other remuneration is not paid or given,directly or indirectly, to a person not registered under thisarticle as a broker-dealer or as an agent.

(12) A transaction by an executor, administrator of an estate,sheriff, marshal, receiver, trustee in bankruptcy, guardian, orconservator.(13) A sale or offer to sell to:

(A) an institutional investor;(B) a federal covered investment adviser; or(C) any other person exempted by rule adopted or orderissued under this article.

(14) A sale or an offer to sell securities of an issuer, if thetransaction is part of a single issue in which:

(A) not more than twenty-five (25) purchasers are present inthis state during any twelve (12) consecutive months, otherthan those designated in subdivision (13);(B) a general solicitation or general advertising is not madein connection with the offer to sell or sale of the securities;(C) a commission or other remuneration is not paid or given,directly or indirectly, to a person other than a broker-dealerregistered under this article or an agent registered under thisarticle for soliciting a prospective purchaser in this state; and(D) the issuer reasonably believes that all the purchasers inthis state, other than those designated in subdivision (13), arepurchasing for investment.

(15) A transaction under an offer to existing security holders ofthe issuer, including persons that at the date of the transactionare holders of convertible securities, options, or warrants, if acommission or other remuneration, other than a standbycommission, is not paid or given, directly or indirectly, forsoliciting a security holder in this state.(16) An offer to sell, but not a sale, of a security not exemptfrom registration under the Securities Act of 1933 if:

(A) a registration or offering statement or similar record asrequired under the Securities Act of 1933 has been filed, butis not effective, or the offer is made in compliance with Rule165 adopted under the Securities Act of 1933 (17 CFR

230.165); and(B) a stop order of which the offeror is aware has not beenissued against the offeror by the commissioner or theSecurities and Exchange Commission, and an audit,inspection, or proceeding that is public and that mayculminate in a stop order is not known by the offeror to bepending.

(17) An offer to sell, but not a sale of, a security exempt fromregistration under the Securities Act of 1933 if:

(A) a registration statement has been filed under this article,but is not effective;(B) a solicitation of interest is provided in a record toofferees in compliance with a rule adopted by thecommissioner under this article; and(C) a stop order of which the offeror is aware has not beenissued by the commissioner under this article and an audit,inspection, or proceeding that may culminate in a stop orderis not known by the offeror to be pending.

(18) A transaction involving the distribution of the securities ofan issuer to the security holders of another person in connectionwith a merger, consolidation, exchange of securities, sale ofassets, or other reorganization to which the issuer, or its parentor subsidiary and the other person, or its parent or subsidiary,are parties.(19) A rescission offer, sale, or purchase under IC 23-19-5-10.(20) An offer or sale of a security to a person not a resident ofthis state and not present in this state if the offer or sale does notconstitute a violation of the laws of the state or foreignjurisdiction in which the offeree or purchaser is present and isnot part of an unlawful plan or scheme to evade this article.(21) Employees' stock purchase, savings, option, profit-sharing,pension, or similar employees' benefit plan, including anysecurities, plan interests, and guarantees issued under acompensatory benefit plan or compensation contract, containedin a record, established by the issuer, its parents, itsmajority-owned subsidiaries, or the majority-owned subsidiariesof the issuer's parent for the participation of their employeesincluding offers or sales of such securities to:

(A) directors; general partners; trustees, if the issuer is abusiness trust; officers; consultants; and advisers;(B) family members who acquire such securities from thosepersons through gifts or domestic relations orders;(C) former employees, directors, general partners, trustees,officers, consultants, and advisers if those individuals wereemployed by or providing services to the issuer when thesecurities were offered; and(D) insurance agents who are exclusive insurance agents ofthe issuer, or the issuer's subsidiaries or parents, or whoderive more than fifty percent (50%) of their annual incomefrom those organizations.

(22) A transaction involving:(A) a stock dividend or equivalent equity distribution,whether the corporation or other business organizationdistributing the dividend or equivalent equity distribution isthe issuer or not, if nothing of value is given by stockholdersor other equity holders for the dividend or equivalent equitydistribution other than the surrender of a right to a cash orproperty dividend if each stockholder or other equity holdermay elect to take the dividend or equivalent equitydistribution in cash, property, or stock;(B) an act incident to a judicially approved reorganization inwhich a security is issued in exchange for one (1) or moreoutstanding securities, claims, or property interests, or partlyin such exchange and partly for cash; or(C) the solicitation of tenders of securities by an offeror in atender offer in compliance with Rule 162 adopted under theSecurities Act of 1933 (17 CFR 230.162).

(23) A nonissuer transaction in an outstanding security by orthrough a broker-dealer registered or exempt from registrationunder this article, if the issuer is a reporting issuer in a foreignjurisdiction designated by this subdivision or by rule adopted ororder issued under this article; has been subject to continuousreporting requirements in the foreign jurisdiction for not lessthan one hundred eighty (180) days before the transaction; andthe security is listed on the foreign jurisdiction's securitiesexchange that has been designated by this subdivision or by ruleadopted or order issued under this article, or is a security of thesame issuer that is of senior or substantially equal rank to thelisted security or is a warrant or right to purchase or subscribeto any of the foregoing. For purposes of this subdivision,Canada, together with its provinces and territories, is adesignated foreign jurisdiction and The Toronto StockExchange, Inc., is a designated securities exchange. After anadministrative hearing in compliance with this article, thecommissioner, by rule adopted or order issued under this article,may revoke the designation of a securities exchange under thissubdivision, if the commissioner finds that revocation isnecessary or appropriate in the public interest and for theprotection of investors.(24) Subject to the following, an offer or sale of securities by anissuer made after June 30, 2014, only to persons who are or theissuer reasonably believes are accredited investors:

(A) The exemption under this subdivision is not available toan issuer that is in the development stage that either has nospecific business plan or purpose or has indicated that itsbusiness plan is to engage in a merger or acquisition with:

(i) an unidentified company or companies; or(ii) another entity or person.

(B) The issuer reasonably believes that all purchasers arepurchasing for investment and not with the view to or for

sale in connection with a distribution of the security. Anyresale of a security sold in reliance on the exemption underthis subdivision within twelve (12) months after sale ispresumed to be with a view to distribution and not forinvestment, except:

(i) a resale under a registration statement effective underIC 23-19-3; or(ii) a resale to an accredited investor under an exemptionavailable under the Indiana Uniform Securities Act.

(C) Except as provided in clause (D), the exemption underthis subdivision is not available to an issuer if the issuer, anyof the issuer's predecessors, any affiliated issuer, any of theissuer's directors, officers, general partners, beneficialowners of ten percent (10%) or more of any class of itsequity securities, any of the issuer's promoters presentlyconnected with the issuer in any capacity, any underwriter ofthe securities to be offered, or any partner, director, or officerof the underwriter:

(i) within the last five (5) years, has filed a registrationstatement that is the subject of a currently effectiveregistration stop order entered by any state securitiesadministrator or the Securities and Exchange Commission;(ii) within the last five (5) years, has been convicted of anycriminal offense in connection with the offer, purchase, orsale of any security, or any criminal offense involvingfraud or deceit;(iii) is currently subject to any state or federaladministrative enforcement order or judgment enteredwithin the last five (5) years, finding fraud or deceit inconnection with the purchase or sale of any security; or(iv) is currently subject to any order, judgment, or decreeof any court with jurisdiction, entered within the last five(5) years, temporarily, preliminarily, or permanentlyrestraining or enjoining the party from engaging in orcontinuing to engage in any conduct or practice involvingfraud or deceit in connection with the purchase or sale ofany security.

(D) Clause (C) does not apply if:(i) the party subject to the disqualification is licensed orregistered to conduct securities related business in the statein which the order, judgment, or decree creating thedisqualification was entered against the party;(ii) before the first offer under the exemption described inthis subdivision, the state securities administrator, or thecourt or regulatory authority that entered the order,judgment, or decree, waives the disqualification; or(iii) the issuer establishes that it did not know and in theexercise of reasonable care, based on a factual inquiry,could not have known that a disqualification existed underthis subdivision.

(E) A general announcement of the proposed offering may bemade by any means. A general announcement described inthis clause must include only the following information,unless additional information is specifically permitted by thecommissioner:

(i) The name, address, and telephone number of the issuerof the securities.(ii) The name, a brief description, and price (if known) ofany security to be issued.(iii) A brief description of the business of the issuer intwenty-five (25) words or less.(iv) The type, number, and aggregate amount of securitiesbeing offered.(v) The name, address, and telephone number of the personto contact for additional information.(vi) A statement that indicates that sales will be made onlyto accredited investors, that no money or otherconsideration is being solicited or will be accepted by wayof the general announcement, that the securities have notbeen registered with or approved by any state securitiesagency or the Securities and Exchange Commission, andthat the securities are being offered and sold under anexemption from registration.

(F) The issuer, in connection with an offer, may provideinformation in addition to the general announcement underclause (E), if the information:

(i) is delivered through an electronic data base that isrestricted to persons who have been prequalified asaccredited investors; or(ii) is delivered after the issuer reasonably believes that theprospective purchaser is an accredited investor.

(G) No telephone solicitation is permitted unless beforeplacing the call, the issuer reasonably believes that theprospective purchaser to be solicited is an accreditedinvestor.(H) Dissemination of the general announcement of theproposed offering to persons who are not accreditedinvestors does not disqualify the issuer from claiming theexemption under this subdivision.(I) The issuer shall file with the division a notice oftransaction, a consent to service of process, a copy of thegeneral announcement, and a fee established by thecommissioner within fifteen (15) days after the first sale inIndiana.

(25) An offer to sell or a sale of a security of an issuer madeafter June 30, 2014, if:

(A) the transaction is part of a single issue in which:(i) the offer or sale is made in compliance with 17 CFR230.504, 17 CFR 230.505, and 17 CFR 230.506, includingany offer or sale made exempt by the application of 17

CFR 508(a);(ii) the issuer is required to submit a notice filing on aForm D not later than fifteen (15) days after the first saleof securities in this state; and(iii) by submitting the notice described in item (ii), theissuer agrees, upon written request by the commissioner,to furnish to the commissioner any information the issuerfurnished to offerees;

(B) for offerings made in compliance with 17 CFR 230.504,no commission, fee, or other remuneration is paid or given,directly or indirectly, to any broker-dealer for soliciting anyprospective purchaser in this state unless the broker-dealer isappropriately registered under this article. It is a defense toa violation of this clause if the issuer sustains the burden ofproof that the issuer did not know and, in the exercise ofreasonable care could not have known, that the person whoreceived the commission, fee, or other remuneration was notproperly registered; and(C) in all sales to purchasers other than those described insubdivision (13) for offerings made in compliance with 17CFR 230.504, at least one (1) of the following is satisfied:

(i) The investment is suitable for the purchaser upon thebasis of facts, if any facts are disclosed by the purchaser,as to the purchaser's other securities holdings, financialsituation, and needs. For purposes of this item only, it ispresumed that, if the investment does not exceed tenpercent (10%) of the investor's net worth, the investmentis suitable.(ii) The purchaser, either alone or with the purchaser'srepresentative or representatives, has the knowledge andexperience in financial and business matters thatdemonstrate that the purchaser is capable of evaluating themerits and risks of the prospective investment.

(26) Any offer or sale of securities after June 30, 2014, by anissuer that meets the requirements of the federal exemption forintrastate offerings in Section 3(a)(11) of the Securities Act of1933, 15 U.S.C. 77c(a)(11), and Securities and ExchangeCommission Rule 147, 17 CFR 230.147. However, all thefollowing apply:

(A) The issuer must make a notice filing with the division ona form prescribed by the commissioner within thirty (30)days after the first sale in Indiana.(B) Any commission, discount, or other remuneration forsales of securities in Indiana must be paid or given only todealers or salespersons licensed under this article.(C) The issuer must pay the fee established by thecommissioner. However, no filing fee is required to fileamendments to Form D of the Securities and ExchangeCommission.(D) Within ten (10) days of receiving the form required by

this subdivision, the commissioner may require the issuer tofurnish any additional information considered necessary bythe commissioner to determine the issuer's qualifications.

(27) An offer or sale of a security made after June 30, 2014, byan issuer if the offer or sale is conducted in accordance with allthe following requirements:

(A) The issuer of the security is a business entity organizedunder the laws of Indiana and authorized to do business inIndiana.(B) The transaction meets the requirements of the federalexemption for intrastate offerings in Section 3(a)(11) of theSecurities Act of 1933 (15 U.S.C. 77c(a)(11)) and Rule 147adopted under the Securities Act of 1933 (17 CFR 230.147).(C) Except as provided in clause (E), the sum of all cash andother consideration to be received for all sales of the securityin reliance on the exemption under this subdivision,excluding sales to any accredited investor or institutionalinvestor, does not exceed the following amount:

(i) If the issuer has not undergone and made available toeach prospective investor and the commissioner thedocumentation resulting from a financial audit of its mostrecently completed fiscal year that complies with generallyaccepted accounting principles, one million dollars($1,000,000), less the aggregate amount received for allsales of securities by the issuer within the twelve (12)months before the first offer or sale made in reliance on theexemption under this subdivision.(ii) If the issuer has undergone and made available to eachprospective investor and the commissioner thedocumentation resulting from a financial audit of its mostrecently completed fiscal year that complies with generallyaccepted accounting principles, two million dollars($2,000,000), less the aggregate amount received for allsales of securities by the issuer within the twelve (12)months before the first offer or sale made in reliance on theexemption under this subdivision.

(D) An offer or sale to an officer, director, partner, trustee, orindividual occupying similar status or performing similarfunctions with respect to the issuer or to a person owning tenpercent (10%) or more of the outstanding shares of any classor classes of securities of the issuer does not count towardthe monetary limitations in clause (C).(E) The issuer does not accept more than five thousanddollars ($5,000) from any single purchaser unless thepurchaser is an accredited investor.(F) Unless waived by written consent by the commissioner,not less than ten (10) days before the commencement of anoffering of securities in reliance on the exemption under thissubdivision, the issuer must do all the following:

(i) Make a notice filing with the division on Form D of the

Securities and Exchange Commission.(ii) Pay the fee established by the commissioner. However,no filing fee is required to file amendments to Form D ofthe Securities and Exchange Commission.(iii) Provide the commissioner a copy of the disclosuredocument to be provided to prospective investors underclause (L).(iv) Provide the commissioner a copy of an escrowagreement with a bank, regulated trust company orcorporate fiduciary, savings bank, savings and loanassociation, or credit union authorized to do business inIndiana in which the issuer will deposit the investor fundsor cause the investor funds to be deposited. The bank,regulated trust company or corporate fiduciary, savingsbank, savings and loan association, or credit union inwhich the investor funds are deposited is only responsibleto act at the direction of the party establishing the escrowagreement and does not have any duty or liability,contractual or otherwise, to any investor or other person.(v) The issuer shall not access the escrow funds until theaggregate funds raised from all investors equals or exceedsthe minimum amount specified in the escrow agreement.(vi) An investor may cancel the investor's commitment toinvest if the target offering amount is not raised before thetime stated in the escrow agreement.

(G) The issuer is not, either before or as a result of theoffering, an investment company, as defined in Section 3 ofthe Investment Company Act of 1940 (15 U.S.C. 80a-3), anentity that would be an investment company but for theexclusions provided in Section 3(c) of the InvestmentCompany Act of 1940 (15 U.S.C. 80a-3(c)), or subject to thereporting requirements of Section 13 or 15(d) of theSecurities Exchange Act of 1934 (15 U.S.C. 78m or 15U.S.C. 78o(d)).(H) The issuer informs all prospective purchasers ofsecurities offered under an exemption under this subdivisionthat the securities have not been registered under federal orstate securities law and that the securities are subject tolimitations on resale. The issuer shall display the followinglegend conspicuously on the cover page of the disclosuredocument:

"IN MAKING AN INVESTMENT DECISION,INVESTORS MUST RELY ON THEIR OWNEXAMINATION OF THE ISSUER AND THE TERMSOF THE OFFERING, INCLUDING THE MERITS ANDRISKS INVOLVED. THESE SECURITIES HAVE NOTBEEN RECOMMENDED BY ANY FEDERAL ORSTATE SECURITIES COMMISSION OR DIVISION ORO T H E R R E G U L A T O R Y A U T H O R I T Y .FURTHERMORE, THE FOREGOING AUTHORITIES

HAVE NOT CONFIRMED THE ACCURACY ORDETERMINED THE ADEQUACY OF THISDOCUMENT. ANY REPRESENTATION TO THECONTRARY IS A CRIMINAL OFFENSE. THESESECURITIES ARE SUBJECT TO RESTRICTIONS ONTRANSFERABILITY AND RESALE AND MAY NOTBE TRANSFERRED OR RESOLD EXCEPT ASPERMITTED BY SUBSECTION (e) OF SEC RULE 147(17 CFR 230.147(e)) AS PROMULGATED UNDER THESECURITIES ACT OF 1933, AS AMENDED, AND THEAPPLICABLE STATE SECURITIES LAWS,PURSUANT TO REGISTRATION OR EXEMPTIONTHEREFROM. INVESTORS SHOULD BE AWARETHAT THEY WILL BE REQUIRED TO BEAR THEFINANCIAL RISKS OF THIS INVESTMENT FOR ANINDEFINITE PERIOD OF TIME.".

(I) The issuer requires each purchaser to certify in writing orelectronically as follows:

"I UNDERSTAND AND ACKNOWLEDGE THAT I aminvesting in a high-risk, speculative business venture. Imay lose all of my investment, or under somecircumstances more than my investment, and I can affordthis loss. This offering has not been reviewed or approvedby any state or federal securities commission or division orother regulatory authority and no such person or authorityhas confirmed the accuracy or determined the adequacy ofany disclosure made to me relating to this offering. Thesecurities I am acquiring in this offering are illiquid, thereis no ready market for the sale of such securities, it may bedifficult or impossible for me to sell or otherwise disposeof this investment, and, accordingly, I may be required tohold this investment indefinitely. I may be subject to taxon my share of the taxable income and losses of thecompany, whether or not I have sold or otherwise disposedof my investment or received any dividends or otherdistributions from the company.".

(J) The issuer obtains from each purchaser of a securityoffered under an exemption under this subdivision evidencethat the purchaser is a resident of Indiana and, if applicable,is an accredited investor.(K) All payments for purchase of securities offered under anexemption under this subdivision are directed to and held bythe financial institution specified in clause (F)(iv). Thecommissioner may request from the financial institutionsinformation necessary to ensure compliance with thissection. This information is not a public record and is notavailable for public inspection.(L) The issuer of securities offered under an exemption underthis subdivision provides a disclosure document to eachprospective investor at the time the offer of securities is

made to the prospective investor that contains all thefollowing:

(i) A description of the company, its type of entity, theaddress and telephone number of its principal office, itshistory, its business plan, and the intended use of theoffering proceeds, including any amounts to be paid, ascompensation or otherwise, to any owner, executiveofficer, director, managing member, or other personoccupying a similar status or performing similar functionson behalf of the issuer.(ii) The identity of all persons owning more than twentypercent (20%) of the ownership interests of any class ofsecurities of the company.(iii) The identity of the executive officers, directors,managing members, and other persons occupying a similarstatus or performing similar functions in the name of andon behalf of the issuer, including their titles and their priorexperience.(iv) The terms and conditions of the securities beingoffered and of any outstanding securities of the company;the minimum and maximum amount of securities beingoffered, if any; either the percentage ownership of thecompany represented by the offered securities or thevaluation of the company implied by the price of theoffered securities; the price per share, unit, or interest ofthe securities being offered; any restrictions on transfer ofthe securities being offered; and a disclosure of anyanticipated future issuance of securities that might dilutethe value of securities being offered.(v) The identity of any person who has been or will beretained by the issuer to assist the issuer in conducting theoffering and sale of the securities, including any Internetweb site operator but excluding persons acting solely asaccountants or attorneys and employees whose primary jobresponsibilities involve the operating business of the issuerrather than assisting the issuer in raising capital.(vi) For each person identified as required in this clause, adescription of the consideration being paid to the personfor such assistance.(vii) A description of any litigation, legal proceedings, orpending regulatory action involving the company or itsmanagement.(viii) The names and addresses, including the UniformResource Locator, of each Internet web site that will beused by the issuer to offer or sell securities under anexemption under this subdivision.(ix) Any additional information material to the offering,including, if appropriate, a discussion of significant factorsthat make the offering speculative or risky. This discussionmust be concise and organized logically and may not be

limited to risks that could apply to any issuer or anyoffering.

(M) The exemption under this subdivision may not be usedin conjunction with any other exemption under this article,except for offers and sales to individuals identified in thedisclosure document, during the immediately precedingtwelve (12) month period.(N) The exemption described in this subdivision does notapply if an issuer or person affiliated with the issuer oroffering is subject to disqualification established by thecommissioner by rule or contained in the Securities Act of1933 (15 U.S.C. 77c(a)(11)) and Rule 147 adopted under theSecurities Act of 1933 (17 CFR 230.262). However, thisclause does not apply if both of the following are met:

(i) On a showing of good cause and without prejudice toany other action by the commissioner, the commissionerdetermines that it is not necessary under the circumstancesthat an exemption is denied.(ii) The issuer establishes that it made a factual inquiry intowhether any disqualification existed under this subdivisionbut did not know, and in the exercise of reasonable care,could not have known that a disqualification existed underthis subdivision. The nature and scope of the requisiteinquiry will vary based on the circumstances of the issuerand the other offering participants.

(O) The offering exempted under this subdivision is madeexclusively through one (1) or more Internet web sites andeach Internet web site is subject to the following:

(i) Before any offer or sale of securities, the issuer mustprovide to the Internet web site operator evidence that theissuer is organized under the laws of Indiana and isauthorized to do business in Indiana.(ii) Subject to items (iii) and (v), the Internet web siteoperator must register with the division by filing astatement, accompanied by the filing fee established by thecommissioner, that includes all the information describedin section 2.3(b) of this chapter.(iii) The Internet web site operator is not required toregister as a broker-dealer if all the conditions in section2.3(c) of this chapter apply with respect to the Internet website and its operator.(iv) If any change occurs that affects the Internet web site'sregistration exemption, the Internet web site operator mustnotify the division within thirty (30) days after the changeoccurs.(v) The Internet web site operator is not required to registeras a broker-dealer under item (ii) if the Internet web siteoperator is registered as a broker-dealer under theSecurities Exchange Act of 1934 (15 U.S.C. 78o) or is afunding portal registered under the Securities Act of 1933

(15 U.S.C. 77d-1) and the Securities and ExchangeCommission has adopted rules under authority of Section3(h) of the Securities Exchange Act of 1934 (15 U.S.C.78c(h)) and P.L.112-106, Section 304, governing fundingportals. This item does not require an Internet web siteoperator to register as a broker-dealer under the SecuritiesExchange Act of 1934 or as a funding portal under theSecurities Act of 1933.(vi) The issuer and the Internet web site operator mustmaintain records of all offers and sales of securitieseffected through the Internet web site and must provideready access to the records to the division, upon request.The records of an Internet web site operator under thisclause are subject to the reasonable periodic, special, orother audits or inspections by a representative of thecommissioner, in or outside Indiana, as the commissionerconsiders necessary or appropriate in the public interestand for the protection of investors. An audit or inspectionmay be made at any time and without prior notice. Thecommissioner may copy, and remove for audit orinspection copies of, all records the commissionerreasonably considers necessary or appropriate to conductthe audit or inspection. The commissioner may assess areasonable charge for conducting an audit or inspectionunder this item.(vii) The Internet web site operator shall limit web siteaccess to the offer or sale of securities to only Indianaresidents.(viii) The Internet web site operator shall not hold,manage, possess, or handle investor funds or securities.(ix) The Internet web site operator may not be aninvestorin any Indiana offering under this subdivision orsubdivision (26).

(P) An issuer of a security, the offer and sale of which isexempt under this subdivision, shall provide, free of charge,a quarterly report to the issuer's investors until no securitiesissued under an exemption under this subdivision areoutstanding. An issuer may satisfy the reporting requirementof this clause by making the information available on anInternet web site if the information is made available withinforty-five (45) days after the end of each fiscal quarter andremains available until the succeeding quarterly report isissued. An issuer shall file each quarterly report under thisclause with the division and, if the quarterly report is madeavailable on an Internet web site, the issuer shall also providea written copy of the report to any investor upon request. Thereport must contain all the following:

(i) Compensation received by each director and executiveofficer, including cash compensation earned since theprevious report and on an annual basis and any bonuses,

stock options, other rights to receive securities of the issueror any affiliate of the issuer, or other compensationreceived.(ii) An analysis by management of the issuer of thebusiness operations and financial condition of the issuer.

(Q) In 2019 and every fifth year thereafter, the commissionershall cumulatively adjust the dollar limitations provided inclause (C) to reflect the change in the Consumer Price Indexfor all Urban Consumers published by the federal Bureau ofLabor Statistics rounding each dollar limitation to the nearestfifty thousand dollars ($50,000).

As added by P.L.27-2007, SEC.23. Amended by P.L.106-2014,SEC.3.

IC 23-19-2-2.3Internet web site operators

Sec. 2.3. (a) This section applies to an offering under section2(27)(O) of this chapter that is made exclusively through one (1) ormore Internet web sites and each Internet web site.

(b) As required by section 2(27)(O)(ii) of this chapter, the Internetweb site operator shall register with the division by filing a statement,accompanied by the filing fee established by the commissioner, thatincludes all the following:

(1) That the Internet web site operator is a business entityorganized under the laws of Indiana and authorized to dobusiness in Indiana.(2) That the Internet web site is being used to offer and sellsecurities pursuant to the exemption under section 2(27) of thischapter.(3) The identity and location of, and contact information for, theInternet web site operator.(4) Except as provided in subsection (c), that the Internet website operator is registered as a broker-dealer under IC 23-19-4.

(c) The Internet web site operator is not required to register as abroker-dealer if all the following apply with respect to the Internetweb site and its operator:

(1) It does not offer investment advice or recommendations.(2) It does not solicit purchases, sales, or offers to buy thesecurities offered or displayed on the Internet web site.(3) It does not compensate employees, agents, or other personsfor the solicitation or based on the sale of securities displayed orreferenced on the Internet web site.(4) It is not compensated based on the amount of securities sold,and it does not hold, manage, possess, or otherwise handleinvestor funds or securities.(5) The fee it charges an issuer for an offering of securities onthe Internet web site is a fixed amount for each offering, avariable amount based on the length of time that the securitiesare offered on the Internet web site, or a combination of thefixed and variable amounts.

(6) It does not identify, promote, or otherwise refer to anyindividual security offered on the Internet web site in anyadvertising for the Internet web site.(7) It does not engage in any other activities that the division, byrule, determines are prohibited of the Internet web site.(8) Neither the Internet web site operator, nor any director,executive officer, general partner, managing member, or otherperson with management authority over the Internet web siteoperator, has been subject to any conviction, order, judgment,decree, or other action specified in Rule 506(d)(1) adoptedunder the Securities Act of 1933 (17 CFR 230.506(d)(1)) thatwould disqualify an issuer under Rule 506(d) adopted under theSecurities Act of 1933 (17 CFR 230.506(d)) from claiming anexemption specified in Rule 506(a) to Rule 506(c) adoptedunder the Securities Act of 1933 (17 CFR 230.506(a) to 17 CFR230.506(c)).

As added by P.L.106-2014, SEC.4.

IC 23-19-2-2.4Exempt transaction; conditions

Sec. 2.4. (a) As used in this section, "person associated with theissuer" includes the following:

(1) A predecessor of an issuer.(2) An issuer affiliated with the issuer.(3) A director, an officer, or a general partner of the issuer.(4) A beneficial owner of at least ten percent (10%) of any classof the issuer's equity securities.(5) A promoter presently connected with the issuer in anycapacity.(6) An underwriter of the securities of the issuer that are to beoffered.(7) A partner, a director, or an officer of an underwriterdescribed in subdivision (6).

(b) A transaction described in section 2(26) of this chapter is notexempt under section 2(26) of this chapter if:

(1) the issuer of the security or a person associated with theissuer:

(A) has, within the past five (5) years, filed a registrationstatement that is the subject of a currently effectiveregistration stop order entered by any state securitiesadministrator or the Securities and Exchange Commission;(B) has, within the past five (5) years, been convicted of anycriminal offense:

(i) in connection with the offer, purchase, or sale of anysecurity; or(ii) involving fraud or deceit;

(C) is currently subject to any state or federal administrativeenforcement order or judgment, entered within the past five(5) years, finding fraud or deceit in connection with thepurchase or sale of any security; or

(D) is currently subject to any order, judgment, or decree ofany court with jurisdiction, entered within the past five (5)years, temporarily, preliminarily, or permanently restrainingor enjoining the issuer or a person associated with the issuerfrom engaging in or continuing to engage in any conduct orpractice involving fraud or deceit in connection with thepurchase or sale of any security; and

(2) one (1) or more of the following do not apply:(A) The issuer of the security or a person associated with theissuer described in subdivision (1) is licensed or registered toconduct securities related business in the state in which theorder, judgment, or decree creating the disqualification of theexemption was entered against the issuer of the security or aperson associated with the issuer.(B) Before the first offer of a security in reliance on theexemption in section 2(26) of this chapter, the:

(i) state securities administrator; or(ii) court or regulatory authority that entered the order,judgment, or decree waived;

the disqualification of the exemption.(C) The issuer establishes that the issuer did not know and inthe exercise of reasonable care, based on a factual inquiry,could not have known that a disqualification of theexemption existed under this subsection.

(c) A transaction described in section 2(26) of this chapter is notexempt under section 2(26) of this chapter if the issuer of the securityis in the development stage of the issuer's business and:

(1) does not have a specific business plan or purpose; or(2) has indicated that the issuer's business plan is to engage ina merger or acquisition with an unidentified company,companies, entity, or other person.

As added by P.L.71-2014, SEC.2.

IC 23-19-2-2.6Exemption transaction; requirements; general announcement;additional information; filing

Sec. 2.6. (a) This section applies only to the sale of or offer to sella security in reliance on the exemption under section 2(26) of thischapter.

(b) A general announcement of a proposed offering of securitiesmay be made by any means.

(c) Except as provided in subsection (d), a general announcementdescribed in subsection (b) may include only the followinginformation unless additional information is specifically permitted bythe commissioner:

(1) The name, address, and telephone number of the issuer ofthe securities.(2) The name and a brief description and price, if known, of anysecurity to be issued.(3) A brief description of the business of the issuer in less than

twenty-six (26) words.(4) The type, number, and aggregate amount of securities beingoffered.(5) The name, address, and telephone number of the person tocontact for additional information.(6) A statement that:

(A) sales will be made only to accredited investors;(B) no money or other consideration is being solicited or willbe accepted by way of the general announcement; and(C) the securities:

(i) have not been registered with or approved by any statesecurities agency or the Securities and ExchangeCommission; and(ii) are being offered and sold pursuant to an exemptionfrom registration.

(d) An issuer, in connection with an offer to sell a security inreliance on the exemption under section 2(26) of this chapter, mayprovide information in addition to the general announcementdescribed in subsection (c) if one (1) or more of the following apply:

(1) The information is delivered through an electronic data basethat is restricted to persons who have been prequalified asaccredited investors.(2) The information is delivered after the issuer reasonablybelieves that the prospective purchaser is an accredited investor.

(e) The issuer may not make solicitations by telephone for the saleof or offer to sell securities in reliance on the exemption undersection 2(26) of this chapter unless before placing the telephone callthe issuer reasonably believes that the prospective purchaser theissuer will be soliciting is an accredited investor.

(f) Any dissemination of the general announcement of theproposed offering described in this section does not disqualify theissuer from claiming the exemption under section 2(26) of thischapter.

(g) The issuer shall file with the securities division a:(1) Model Accredited Investor Exemption Uniform Notice ofTransaction, along with a consent to service of process; and(2) copy of the general announcement;

not later than fifteen (15) days after the first sale of the security inIndiana.As added by P.L.71-2014, SEC.3.

IC 23-19-2-3Additional exemptions; waivers

Sec. 3. A rule adopted or order issued under this article mayexempt a security, transaction, or offer; a rule under this article mayexempt a class of securities, transactions, or offers from any or all ofthe requirements of IC 23-19-3-1 through IC 23-19-3-6 andIC 23-19-5-4; and an order under this article may waive, in whole orin part, any or all of the conditions for an exemption or offer undersections 1 and 2 of this chapter.

As added by P.L.27-2007, SEC.23.

IC 23-19-2-4Denial, suspension, revocation, condition, or limitation ofexemptions; knowledge of order

Sec. 4. (a) Except with respect to a federal covered security or atransaction involving a federal covered security, an order under thisarticle may deny, suspend application of, condition, limit, or revokean exemption created under section 1(3)(C), (1)(7), 1(8), or 2 of thischapter or an exemption or waiver created under section 3 of thischapter with respect to a specific security, transaction, or offer. Anorder under this section may be issued only under the procedures inIC 23-19-3-6(d) or IC 23-19-6-4 and only prospectively.

(b) A person does not violate IC 23-19-3-1, IC 23-19-3-3 throughIC 23-19-3-6, IC 23-19-5-4, or IC 23-19-5-10 by an offer to sell,offer to purchase, sale, or purchase effected after the entry of an orderissued under this section if the person did not know, and in theexercise of reasonable care could not have known, of the order.As added by P.L.27-2007, SEC.23.

IC 23-19-2-5Emergency rules

Sec. 5. The commissioner may adopt emergency rules in themanner provided under IC 4-22-2-37.1 to implement this chapter.As added by P.L.106-2014, SEC.5.